Careers: Interview Prep for Investment Banking and Corporate Finance

October 3, 2016
Interview Prep for Investment Banking and Corporate Finance

Interview Prep is a critical element of our course FMVC (Financial modeling and valuation), one of India’s leading programs for learning Financial Modeling and Valuation. Financial Modeling and Valuation is imperative for careers in Corporate Finance, be it Investment Banking, Private Equity, Equity Research or even start up’s.
In fact in this day and age, every start up needs to have a head of Finance that can help create business models, project cashflow and create financial models that help in fund raising. While the career options post FMVC are varied, most people find it extremely hard to crack the interview process in Investment Banking and Private Equity because a significant part of the interview is dedicated to questions on Financial Modeling and Valuation. So here are a list of actual questions that got  asked in Investment Banking and Private Equity interview, as it pertains to Financial Modeling and Valuation.

Private Equity Interview Questions

  • What is IRR? What is the formula and how do you calculate it? A company worth 100mn today is sold for 500mn after 5 yrs so what is the IRR for this investment.
  • What is more expensive debt or equity? And why?
  • How do you forecast the various aspects of the financial statement?

A leading boutique investment bank

  • Run me through DCF & cash flow.
  • What is Working Capital & how do we forecast it?
  • If a company’s book value is 10 mn & it is been sold @ 12 mn, what would be the effect on three financial statements
  • How do you calculate EV? EV/EBITDA multiple?
  • Difference between the P/E multiple and the EV/EBITDA multiple.
  • What is EBITDA and how do you find it?
  • What is included in COGS?
  • What is percentage by Sales method?
  • What are SG&A expenses? Give examples.
  • Is factory labor expenses a part of SG&A expenses or COGS? Why?
  • What is Gross Profit? How do you calculate it?
  • Difference between Gross Profit and EBITDA?
  • What is operating profit?
  • Explain how you do a DCF.
  • How do you get to FCFF?
  • How do you get to FCFE?
  • Difference between FCFF and FCFE.
  • What is WACC? How do you calculate it?
  • How do you find cost of equity?
  • How do you calculate Beta?
  • What is risk free rate of return? How do get it?
  • What is equity risk premium?
  • In the CAPM formula how did you arrive at the market return figure?
  • Why does an increase in Working capital assets reduce your cash flow from operations?
  • Why does an increase in Working capital liabilities increase your cash flow from operations?
  • Does an increase in debt increase or decrease the value of the company?

Financial Modeling and Valuation ProgramOur FMVC course includes actual mock interviews along with a sample question bank of
over a 200 questions to help you crack the interview process. This is in addition to a comprehensive resume writing and interview prep program and career counseling sessions. For more details please contact 02261419595/ 8108600055

 


 

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